I'm not sure what I think about this yet, but my immediate thoughts are not good. We need to think about all the possible implications, be 99% sure it will work, and go over all of the dynamics and economics of it. I think a lot of things could possibly go wrong, it will hurt our image in the cryptocurrency community, and as someone else already mentioned it will give the detractors more ammo to unload on us with.

It could make the rest of the Cryptocoin community look poorly on us as if we will print money at will on a whim. If we do it this once, what's to stop it from happening multiple times?

I have been using the fact BTSX is pretty much the only deflationary Cryptocoin in existence as a selling point. If we are printing money that selling point disappears and anyone that has been saying this looks foolish or like a liar.

If it doesn't work as well as intended it could end up being very expensive advertising, along with Oall of the other negative side effects as mentioned above. The new users getting free money could just dump it all on the market and it backfire on us.

It is possible the community could fork after making controversial decisions such as this.

It sounds like there will be some counter-party risks in this. If the printed money is stolen it could be dumped on the market, create a lot of bad press, or be used to attack the network.

I have job interview in a bit, I just saw we need to upgrade. I will do so ASAP when I get home.

Just FYI in case I can't make it.

Thanks for the feedback. I am headed to bed, but I will likely edit again tomorrow.

Cheers

Post this on reddit

Ehhh. I'd like to rewrite it a bit. I was a little inebriated while writing it and am a bit embarrassed by the way I worded some things haha. It is a little too confrontational and blunt for an EILI5. 

Quote from: xeroc on September 30, 2014, 05:58:17 pm

puh .. I have no clue .. and worse .. it depends on the country you live in .. not sure how my country will handle this ..

I'm looking at this from a U.S. perspective but I'm interested in all.

Quote from: roadkill on September 30, 2014, 05:55:54 pm

Where is BTC <-> GoxUSD <-> USD taxed, and where is bitBTC <-> bitUSD <-> USD taxed?

Maybe the second example is more accurate as: bitBTC <-> bitUSD <-> (BTSX) <-> USD
The (BTSX) represents what I assume must be a "virtual" transaction/conversion in the bitUSD onramps.

If that assumption is correct, GoxUSD would be playing the same role as BTSX.
So perhaps only GoxUSD <-> USD and BTSX <-> USD are taxed. Once you're in the BTSX ecosystem, you're free. I hope.

This is how I hope it works too, as capital gains are not realized until converting it into FIAT or BTC. Sure, you may make a profitable trade by getting into bitFIAT on the top of a bubble, but then you may also lose it back getting stuck in bitFIAT on a rally. You can just as easily make gains as you can losses as long as you are still trading.

It makes sense to me that capital gains are not realized until you purchase something or a service with bitassets, or you convert them to FIAT. It is like crypto to crypto trading, which is not taxable until you convert it into FIAT and realize your gains or purchase something with the crypto.

Quote from: matt608 on September 30, 2014, 04:29:33 pm

I am pretty sure selling into "digital fiat" on an exchange is a taxable event.

...but yea, you're probably right. Knowing the IRS, they probably would consider fiat transactions on an exchange taxable; but they'd have no real way of knowing unless you tell them.

Not that I disagree with you, but doesn't the tax system technically work on trusting the tax payers to report honestly?

I also kind of agree with the statement, knowing the IRS they will find some way to tax it. 

I was asked a question I don't know the answer to regarding taxes. Can I get some feedback?

Quote from: CoinHoarder on September 30, 2014, 07:15:41 am

Quote from: NewLiberty on September 30, 2014, 06:34:24 am

Quote from: CoinHoarder on September 30, 2014, 03:52:35 am

In the event that a bubble does occur, people can diversify into bitFIAT to reduce the amplitude of the bubble and reduce your exposure, and that is unlike any other cryptocurrency where you would need to actually sell them to reduce exposure which creates downward pressure on the market.

Can you describe the difference you see between "diversify into" and "actually sell".

Let's say you think a cryptocoin is at the top of a mini bubble and will likely go down in value in the short term.

With most cryptocurrencies you would need to sell them on the market to reduce your exposure which creates downward pressure on the market. Money exits the cryptocurrency's ecosystem for another cryptocurrency or FIAT. You could do so off of services or exchanges, but it is not convenient nor quick, and has counterparty risk involved.

With BitsharesX you can instead buy bitFIAT which are backed by BTSX, and thus there is no downward pressure put on the market and no money actually leaves the BTSX ecosystem. Yet, the end result is similar as you still reduce exposure to a downward price swing. There is no reason for the price to go down unless someone wants to exit the BitsharesX ecosystem all together.

In your "diversify into" example.  With what am I buying bitFIAT?  Is this new investment?  Do I still own the BitsharesX that I am expecting to decline in value?  If I do not still own the BTSX, who does?  Why does my selling them not cause downward pressure?

I am not yet finding any difference between "diversify into" and "actually sell" other than "diversify into" includes also purchasing bitFIAT which from the sounds of this "backing" system may create wash sale tax loss implications for me, increasing my risk and limiting my gains due to the way that taxes work.
http://www.sec.gov/answers/wash.htm

Ima get a bitGLD grill



Obama approves